INVESTMENTS IN REAL ESTATE AND OTHER ACQUIRED ASSETS AND ASSUMED LIABILITIES (Tables)

6 Months Ended

Jun. 30, 2026

Investment In Real Estate And Other Acquired Assets And Assumed Liabilities [Abstract]

Schedule of Acquired Assets and Assumed Liabilities

The following table summarizes the book value of the Company’s acquired assets and assumed liabilities (in thousands, except amounts in the footnotes):


	June 30, 2026							December 31, 2025
	Cost Basis		Accumulated Depreciation & Amortization			Carrying Value		Cost Basis		Accumulated Depreciation & Amortization			Carrying Value
Assets acquired:
Investments in real estate, equity:
Investments in real estate (1)	$	58,311	$	(8,964	)	$	49,347	$	74,468	$	(7,797	)	$	66,671
Right of use assets (2)(3)		19,664		(1,159	)		18,505		19,665		(1,024	)		18,641
Intangible assets (4)		9,469		(3,716	)		5,753		9,469		(3,342	)		6,127
Subtotal		87,444		(13,839	)		73,605		103,602		(12,163	)		91,439

Investments in real estate from lending activities:
Investments in real estate (1)		10,025		(397	)		9,628		10,025		(281	)		9,744
Right of use assets (2)(3)		399		(90	)		309		399		(63	)		336
Intangible assets (4)		364		(339	)		25		364		(270	)		94
Subtotal		10,788		(826	)		9,962		10,788		(614	)		10,174

Properties held for sale (5)		90,899		—			90,899		90,825		—			90,825
Total	$	189,131	$	(14,665	)	$	174,466	$	205,215	$	(12,777	)	$	192,438

Liabilities assumed:
Investments in real estate, equity:
Mortgage payables	$	20,253	$	651		$	20,904	$	19,565	$	620		$	20,185
Lease liabilities (3)(6)		45,337		—			45,337		44,958		—			44,958
Subtotal		65,590		651			66,241		64,523		620			65,143

Investments in real estate from lending activities:
Other liabilities		41		(41	)		—		41		(41	)		—
Lease liabilities (3)(6)		382		—			382		378		—			378
Subtotal		423		(41	)		382		419		(41	)		378

Liabilities held for sale (7)		3,233		—			3,233		3,131		—			3,131
Total	$	69,246	$	610		$	69,856	$	68,073	$	579		$	68,652

Total net investments in real estate and properties held for sale (8)	$	119,885				$	104,610	$	137,142				$	123,786

(1)

Investments in real estate include $1.0 million and $15.2 million of land, which is not depreciable, at June 30, 2026 and December 31, 2025, respectively. Also includes $327,000 and $3.7 million of construction in progress, which is also not depreciable until placed in service, at June 30, 2026 and December 31, 2025, respectively. Depreciation expense for the three and six months ended June 30, 2026, was $649,000 and $1.3 million, respectively. Depreciation expense for the three and six months ended June 30, 2025, was $620,000 and $1.2 million, respectively.

(2)

Primarily comprises a $18.3 million and $18.4 million right of use asset, at June 30, 2026 and December 31, 2025, respectively, associated with an acquired ground lease disclosed in footnote (6) below accounted for as an operating lease. Amortization is booked to real estate expenses on the consolidated statements of operations.

Additionally, the Company entered into an operating lease associated with a parking lease at a newly acquired property. The associated right of use asset has a value of $300,000 and $322,000 at June 30, 2026 and December 31, 2025, respectively.

(3)

Refer to Note 8 for additional information on the Company’s remaining operating leases.

(4)

Primarily comprises a franchise intangible of $3.3 million and $3.5 million, a management contract intangible of $2.5 million and $2.6 million, in-place leases of $5,000 and $7,000 and a customer list intangible of $21,000 and $87,000, at June 30, 2026 and December 31, 2025, respectively.

(5)

At June 30, 2026 and December 31, 2025, properties held for sale included a hotel acquired via deed-in-lieu of foreclosure in November 2020, a student housing property acquired in April 2022 and an office property acquired via deed-in-lieu of foreclosure in June 2023.

(6)

Primarily comprised of a $45.1 million and $44.7 million ground lease at June 30, 2026 and December 31, 2025, respectively. The ground lease has a remaining term of 90 years. Lease expense was $1.4 million for both the six months ended June 30, 2026 and 2025, and $725,000 and $705,000 for the three months ended June 30, 2026 and 2025, respectively.

(7)

Comprised of an operating lease liability.

(8)

Excludes items of working capital, either acquired or assumed.

Summary of Expenses of Intangible Assets, Right of Use Assets and Leases

The following table summarizes the expenses of intangible assets, right of use assets and leases related to investments in real estate and other acquired assets and assumed liabilities (in thousands):


	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2026		2025		2026		2025
Assets:
Amortization related to intangible assets	$	221	$	221	$	443	$	324
Amortization related to right of use assets		82		82		164		164
Liabilities:
Accretion related to ground lease liability	$	676	$	656	$	1,347	$	1,307
Lease payments		472		458		943		916

Summary of Expected Amortization Expense on Intangible Assets

The following table summarizes the Company's expected fiscal year amortization expense on its intangible lease assets (in thousands):


	Amortization Expense
Remainder of 2026	$	392
2027		756
2028		748
2029		748
2030		748
2031		748
Total	$	4,140